Opening Bell: 11.2.17

Janet who?; SEC tells celebs not to hawk cryptocurrencies; Guggenheim might have done a little self-dealing; CDOs are back again, again, baby; Osama bin Laden was a 9/11 truther?; and much more.
Author:
Updated:
Original:

Trump to Tap Jerome Powell as Next Fed Chairman (WSJ)
Mr. Powell’s nomination would mark the first time in nearly four decades that a new president hasn’t asked the serving Fed leader to stay on for another term, even though that person was nominated by a president of a different party. The last time a first-term president didn’t do that was in 1978, when President Jimmy Carter chose G. William Miller to succeed Arthur Burns.

Jay Powell

S.E.C. Warns Celebrities Endorsing Virtual Money (NYT)
So far this year, some 270 projects have raised over $3 billion by selling new currencies to investors. The vast sums of money have drawn in celebrities, like the socialite Paris Hilton and the rapper the Game, who have promoted particular projects, generally in exchange for a payment of some sort. The S.E.C. said in a statement released on Wednesday afternoon that celebrities who promoted coin offerings could be violating multiple laws, including antifraud regulations and rules that govern investment brokers.

Guggenheim faces allegations of self-dealing (FT)
“Internally, we were told from people working for the top managers stuff like: ‘Hey, this is a Mark Walter transaction’, or ‘This is a Scott Minerd transaction’, which basically meant don’t ask too many questions and just approve the deal,” says a former senior employee who used to handle conflicts. “We just had to take the boss’s word . . . That wasn’t the case for other standard transactions.”

As Credit Booms, Citi Says Synthetic CDOs May Reach $100 Billion (BBG)
“It would seem as if the low spread-low vol environment, similar to back in 2006-2007 (when investors couldn’t get enough of levered synthetic tranches) has revived some interest in portfolio credit risk,” Citigroup analysts led by Aritra Banerjee wrote. “Investors may not have necessarily wanted to add leverage, but, simply put, they have had to, given the lack of alternatives.”

Tesla's Nightmare Before Christmas (BBG Gadfly)
What we have brewing here is a credibility problem. This has lurked in the background for a while, with various missed targets on sales, capex or whatnot.But the Model 3 is far more important than any of these because it is supposed to generate the vast majority of medium-term cash flows underpinning the valuation models supporting Tesla's high-flying stock; and it is the key test of the company's oft-touted manufacturing and design skill.So when Musk demurred on giving a current production figure because "people read too much into it," he was rather missing the point. SEE ALSO: Elon Musk Just Yelled 'SHAME' At A Bunch Of Journalists

Goldman jokes, takes 'bites' out of pizza to attract borrowers (Reuters)
The Wall Street bank is trying to court Main Street borrowers saddled with credit card debt through its recently launched personal loan platform Marcus, which it says charges borrowers principal and interest, but not fees. The Goldman-sponsored comedy show featured members of Chicago’s famed Second City comedy troupe and menu items like “truffle macaroni & fees,” “steak and gorgonzola fee-zza” and drink specials including “fee’d up gimlet.”

Eugenics 2.0: We’re at the Dawn of Choosing Embryos by Health, Height, and More (Technology Review)
Genomic Prediction says it will only report diseases—that is, identify those embryos it thinks would develop into people with serious medical problems. Even so, on his blog and in public statements, Hsu has for years been developing a vision that goes far beyond that. “Suppose I could tell you embryo four is going to be the tallest, embryo three is going to be the smartest, embryo two is going to be very antisocial. Suppose that level of granularity was available in the reports,” he told the conservative YouTube personality Stefan Molyneux this spring. “That is the near-term future that we as a civilization face. This is going to be here.”

The 42 Weirdest Movies on Osama bin Laden's Computer (Gizmodo)
As Ciazarn points out on Twitter, there’s a file on the list called LooseChange2.flv. Loose Change is the tremendously popular conspiracy theory film that claims the attacks of September 11, 2001 were an inside job orchestrated by the US government and George W. Bush, and not perpetrated by anyone affiliated with Osama bin Laden. What a bizarre world we live in.

Slow Down, Buddy: This 25-Year-Old Who Moved To NYC 4 Months Ago Just Wrote A 1,500-Word Facebook Post About How New Yorkers Stand Together In The Face Of Terror (Clickhole)

Related

Jay Powell

Opening Bell: 10.30.17

It's (probably) gonna be Powell; this week is going to be nuts; whatever happens, buy the dip; how to survive getting locked in a beer cooler; and much more.

guggenheim

Opening Bell: 9.20.17

Guggenheim is in hot water; bitcoin's split could split again; quit your hedge fund and run for governor; a "Mad Pooper" is terrorizing Colorado; and more.

Coming soon to a Bridgewater office near you.

Opening Bell: 11.7.17

Ray Dalio's number-two is reportedly kinda handsy; Forbes says Wilbur Ross lied to them about being a billionaire for years; Dick Fuld is back, baby; Bjork wants to give you cryptocurrency; and more.

SEC_CAT2

Opening Bell: 9.21.17

The SEC got hacked; Mark Zuckerberg is on a transcontinental mission to prove he isn't weird; Chick-fil-A is building a 5-story 9/11-themed restaurant in FiDi; and more.

Opening Bell: 10.22.12

Some Investors Open to Higher US Tax to Shave Deficit (Reuters) In recent weeks, Goldman Sachs CEO Lloyd Blankfein and JPMorgan Chase's Jamie Dimon became the latest Wall Street heavyweights to say they would be willing to pay more in exchange for a deal to balance the country's books. AIG's Benmosche On Why Capitalism Still Works (NYM) As its vaguely omnipotent name suggests, American International Group contained a little of everything: a small bank, an airline-leasing company, and a terrifyingly vast array of international companies that underwrote everything from cows in India to satellites orbiting the Earth. To the emergency team that came in following the crises, the impulse was to get rid of everything, to disassemble this Frankenstein monster once and for all. This was the idea behind Project Destiny. Benmosche had a different one. “Say you’re sitting there, you have gangrene,” he says to me one morning, before I’ve even had coffee. “And I don’t have any instruments. All I have is an ax. And I’ve gotta grab the ax and cut that sucker off. But the ax is dull. And it makes a mess. That’s what they did, in the beginning. They whacked that sucker off. And they kept hacking. But there was value in the body that was left. The body could produce things. And it owed people. What are you going to do, kill the body? Want it to be so ugly and deformed that it could never live? No! What you do is you clean it up, make it more cosmetic. Maybe we can help them get a prosthesis. Maybe they can run in the Olympics one day, like a double amputee, as we saw. Can you imagine that? A double amputee running in the race.” Goldman Bonus System Corrupted In 2005, Smith Book Says (Bloomberg) Before 2005, the company determined workers’ annual awards “not just on how much business you’d brought in, but also on how good you were for the organization,” Smith, a former vice president, writes in “Why I Left Goldman Sachs: A Wall Street Story.” “From 2005 until the present day, the system has become largely mathematical: you were paid a percentage of the amount of revenue next to your name,” a figure that could vary from 5 percent to 7 percent, wrote Smith, 33, without saying how he learned about such a change. “The problem with the new system was that people would now do anything they could -- anything -- to pump up the number next to their name.” 129 Minutes With Goldman Turncoat Greg Smith (NYM) Why I Left Goldman Sachs may disappoint those who hoped for a collection of sordid Wall Street bacchanalia. Smith saw no financial crimes in progress at the bank, and his tales of Goldman life are mostly anodyne workplace micro-dramas told with wide-eyed breathlessness. The book’s most lurid revelation is that Smith once saw Goldman CEO Lloyd Blankfein naked at the company gym. With the book done, Smith says he’s looking forward to resuming a normal life, possibly as a speaker and pundit. Among other things, he’d like to meet a woman. “I’m not anti-capitalism at all,” he says. “I want Goldman to be admired. I just don’t like this notion that ethics and capitalism are different things.” Argentina orders evacuation of ship seized by hedgie Paul Singer as collateral for unpaid bonds (AP) Argentina announced the immediate evacuation Saturday of about 300 crew members from the ARA Libertad, a navy training ship seized in Africa nearly three weeks ago as collateral for unpaid bonds dating from the South American nation's economic crisis a decade ago. Only the captain and a few other members of the crew of 326 sailors will remain on the three-masted tall ship, a symbol of Argentina's navy. Girl, 9, in black and white costume shot as relative mistakes her for skunk (NYDN) A 9-year-old girl was shot outside a Halloween party Saturday night in Western Pennsylvania, taking a bullet to the shoulder from a male relative who mistook her for a skunk. The condition of the girl wasn’t released Sunday, but police in rural New Sewickley Township said she was alert and talking as she was flown to a hospital in Pittsburgh, 30 miles away. Neither the girl nor her relative was identified. She was spotted on a hillside around 8:30 p.m. wearing a black costume and black hat with a white tassel, according to the Beaver County Times. The relative who accidentally injured her was carrying a shotgun. Police Chief Ronald Leindecker said the man wasn’t under the influence of alcohol, and was unsure whether he would be charged. Prince Alwaleed Praises Pandit for Citigroup Crisis Handling (Bloomberg) Saudi billionaire Prince Alwaleed bin Talal praised Vikram Pandit for his handling of the financial crisis while chief executive officer at Citigroup, saying he helped position the bank for further growth. “Many companies like HSBC, Barclays and Standard Chartered shrank and went back to their roots,” Alwaleed, the largest individual investor in Citigroup, said today at a conference in Dubai. “Citigroup never blinked on that. It’s the only global bank at the moment and really the potential is there,” 57-year- old Alwaleed said, adding that Pandit did a “good” job as CEO. West Coast Will Be In 'Colossal' Mess In 5 To 10 Years, Says Marc Faber (CNBC) Faber argued that the political systems in place in the West would allow the debt burden to continue to expand. Under such a scenario of never-ending deficits, the Western world would rack up huge deficits. One day, the system would break, he said. “Eventually, you have either huge changes occurring in a peaceful fashion through reforms, or, usually, through revolutions,” he said. The U.S. is getting closer to such a revolution, he said, as is Europe. Vampire Pong: Ex-Goldman Banker Takes On A Pro (Fortune) Halfway through a recent match, set up by Fortune between Smith and Wally Green, one of the top pros in the country, Smith crouches, leans his head toward the table and serves. The pro swings and misses. Ace....Smith brought own paddle in a soft vinyl case to the match, which was held at Spin, a club in New York. The best part of Smith's game is his serve, which is a deceptive spinning wonder that appears to be going much faster than it is. His first serve of the match, like a number of others, goes right by Green. Smith is up 1-0. "That's a very good serve," says Green. Baby Walrus Adapts To Life In Brooklyn (NYT) A team of 15 is caring for him around the clock. His favorite toy is a plastic bucket. He has taken swimmingly to a large pool. And on Friday, he had his first taste of solid food — surf clams. “He’s hitting every milestone we’re hoping to see,” said Jon Forrest Dohlin, director of the New York Aquarium in Coney Island, Brooklyn, part of the Wildlife Conservation Society. “He still has some issues with his bladder, but they are trending in the right direction. Behaviorally, he’s doing great and we’re feeling good about his progress.” He was describing Mitik, or Mit for short, one of two walrus calves separated from a herd in the Arctic Ocean and orphaned in Alaska in July. The Alaska SeaLife Center took them in and found new homes for each. (The other walrus, Pakak, went to the Indianapolis Zoo.) The New York Aquarium, eager for a young companion for its two older walruses, stepped up, flying a staff member, Martha Hiatt, to Alaska to work with Mit for a month. On Oct. 11, Ms. Hiatt, the aquarium’s behavioral husbandry supervisor, along with a veterinarian, accompanied Mit on a FedEx cargo jet from Anchorage to Newark. The walrus, believed to be about 16 weeks old, stayed in his crate during the six-hour flight. “It was loud,” Ms. Hiatt said of the trip. “He pretty much sang to us the entire time. We stayed with him, talked to him and hosed him off now and then.” [...] much of Mit’s day consists of play, which helps his development and encourages his cooperation during medical procedures and feedings. One of his favorite activities is to scoop up a giant white bucket with holes through it. “He loves to run around with that on his head and vocalize,” Ms. Hiatt said.

Snap founders Evan Spiegel and Bobby Murphy

Opening Bell: 5.12.17

Millennial investors are ditching Snap; J. Peterman from Seinfeld is hawking a questionable IPO; the lengths we go for beer; and more.